Double Seven-Day Pullback Entries with a 200-Day SMA Filter

Summary

The strategy uses a long-term trend filter and short lookback price levels to define long entries and exits. It requires price to remain above a 200-day simple moving average, enters long when the close falls below the prior seven-day closing-price low, and exits when the close rises above the prior seven-day closing-price high. The entry is therefore a pullback below a recent low within the longer-term uptrend, while the exit waits for a move above a recent high.

The document calls the rules simple and says the approach performed well in some stocks and periods, but gives no supporting performance figures or specific stock results. Published backtest settings instead specify BTC_USDT futures on hourly bars with a 15-minute base period over December 2023, which does not match the stock-focused description. Risks include failed signals and correlated losses during broad market declines. The source uses full-equity position sizing and does not implement the stated test-date inputs or a stop loss, so those aspects warrant care in interpreting the description.

Key ideas

• Price must be above the 200-day SMA before the strategy can enter a long position.
• The entry rule buys after a close below the previous seven-day low, while the exit follows a close above the previous seven-day high.
• Despite its name, the setup combines a pullback entry with a recent-high exit.
• The document provides no quantified results, and its stock discussion differs from its published BTC futures backtest settings.

Tags

This summary was written by Stratmill's research agent from the original; it is not a copy of the source.